The New York State Public Service Commission has amended its rules to strengthen protections for energy service company (ESCO) customers and extended a pause on removing households from state energy affordability programs.
These actions follow legislation signed by Governor Kathy Hochul aimed at shielding consumers from unexpected increases in their energy bills. The amendments align the Uniform Business Practices rules and Standard Renewal Notice with recent changes to New York’s General Business Law, which established a bill of rights for ESCO customers.
“Governor Hochul continues to ensure the economic wellbeing of consumers remains first and foremost,” said Commission Chair Rory M. Christian. “These new amendments will ensure ESCO customers remain protected from sharp, unexpected price increases from the energy the consumer needs to run their homes and businesses. Further, as recognized by the utilities, the EAPs faced a confluence of unprecedented and unforeseeable events due to the federal government shutdown. To avoid the disenrollment of a potentially large number of customers who would otherwise be enrolled in each utility’s EAP, the Commission directed the utilities to pause any disenrollment.”
The Commission regulates ESCOs in New York and requires them to comply with strict guidelines, including filing annual compliance reports by January 31 each year. Failure to comply can result in losing eligibility to operate in New York.
In 2019, regulators prohibited ESCOs from placing customers into variable-rate contracts that cost significantly more than local utility rates. Variable-rate contracts must now guarantee savings compared to local distribution utilities, while fixed-rate products cannot exceed five percent above the previous year’s average commodity cost charged by those utilities.
Recent legal changes require that any change in price or product type within an ESCO contract is considered “material” and needs customer consent. Providers must also disclose current prices, proposed changes, distribution prices, and information about how customers can review past bills when contracts are renewed.
Currently, there are 151 ESCOs operating in New York serving nearly one million electric and gas customers—compared with over seven million electric and five million natural gas customers served directly by traditional utilities. Both utility supply pricing and ESCO supply pricing fluctuate with global commodity markets; forecasts are regularly provided before peak heating or cooling seasons.
On another front, state-funded Energy Affordability Programs (EAPs) offer direct discounts on utility bills so eligible households pay no more than six percent of their income on energy costs. Enrollment is generally linked with participation in federally funded programs such as HEAP (Home Energy Assistance Program). Disruptions caused by a federal government shutdown have threatened access for many families.
To address this risk, the Commission ordered major utilities to extend a pause on removing participants from EAPs through November 2026—a move designed to protect more than one million households if federal assistance lapses during critical periods like winter heating season.
Governor Hochul recently highlighted resources available for residents facing higher home heating costs due to potential loss of federal HEAP funding—which supports around 1.5 million low-income households statewide—and encouraged people to check eligibility for state programs via the State’s EAP website.
Additional protections under state law include requirements that utilities make special efforts between November 1 and April 15 each year before disconnecting heat-related services if it could threaten health or safety—a mandate outlined under New York’s Home Energy Fair Practices Act (HEFPA).
Commission decisions referenced can be found on the agency’s website using Case Numbers 98-M-1343 (UBP) or 14-M-0565 (EAP). Assistance is available for non-English speakers via phone support.
